ThaiNamthip Ltd, the Coca-Cola bottler in Thailand, has formed a joint venture with PT Construction Co in Laos for bottling and distributing carbonated and non-carbonated beverages in the neighbouring country.
A Coke delivery truck goes past the Patuxai Gate in Vientiane yesterday.
The new venture will expand the availability of Coca-Cola's products in Laos _ Coke, Fanta, Sprite, Minute Maid juice and Namthip drinking water.
Called Lao Coca-Cola Bottling Co, the joint venture has initial capital of US$40 million (1.23 billion baht) for the first five years.
ThaiNamthip owns 70% and PT Construction 30%.
Lao Coca-Cola began distribution in Laos yesterday, with Coca-Cola products supplied by ThaiNamthip's factories in Thailand.
The company will build a bottling plant in Vientiane, to be operational in 2014.
The factory will employ about 70 people and generate additional indirect employment for 500 more.
Lao Deputy Prime Minister Somsavat Lengsavad, who witnessed the joint venture's signing ceremony in Vientiane, said this is an important milestone for commercial relations between the two countries.
"Fostering closer commercial ties between our two nations through this joint venture is a great way to further strengthen our close relationship and boost the well-being and prosperity of our people," he said.
Pornwut Sarasin, vice-chairman of ThaiNamthip and chairman of Lao Coca-Cola, said the Thai company has been ready to expand outside Thailand for some time.
"With the increasing momentum of regionalisation brought by the impending implementation of the Asean Economic Community, starting a business in Laos is a great way to share and expand ThaiNamthip's know-how regionally," he said.
Van Hoang Dau, the chairman and chief executive of PT Construction, said he is very pleased to enter into this joint venture with ThaiNamthip and proud to work with an international, iconic brand such as Coca-Cola.
The timing dovetails with the entry of Laos into the World Trade Organization (WTO) and the beginning of the country's integration into the global economy.
"The ninth Asia-Europe Meeting held recently in Laos is a testimony for the country to become a full-fledged player in the global market. I'm confident this partnership will be very successful and grow rapidly," he said.